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2016 (4) TMI 541 - CESTAT MUMBAI

2016 (4) TMI 541 - CESTAT MUMBAI - TMI - Admissibility of Cenvat credit - Goods not received in the factory - Revenue contended that it is not the responsibility of the Revenue to establish that the goods were not received but the responsibility of petitioner - Held that:- it is clear from the text of the Rule that the onus of establishing that the goods have been received is on the person who has taken the credit. The show-cause notice invoked the said rule and produced certain evidence in the .....

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e 9(5) of the Cenvat Credit Rules , the matter is remanded back.

Imposition of penalty - Rule 15/15(2) of the CCR, 2004 read with Section 11AC of the Central Excise Act, 1944 - Held that:- by following the decision of Hon'ble Bombay High Court in the case of Ashok Kumar H Fulwadhya [2010 (1) TMI 229 - BOMBAY HIGH COURT], the penalties imposed under Rule 15/15(2) of CCR on other respondents are set aside. - Appeal disposed of - Appeal No. E/522 to 527/09 - Dated:- 31-3-2016 - SHRI RAJU .....

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aterial supplier as well as those of employees and Director were recorded to substantiate the claim. The statements of employees, Director and suppliers were retracted. The show-cause notice invoked Rule 9(5) of the Cenvat Credit Rules reads, 2004. The show-cause notice was confirmed by the original adjudicating authority and various penalties ranging from ₹ 10 lakhs to 20 lakhs were imposed on other noticees under Rule 15(2) and Rule 15 of the Cenvat Credit Rules, 2004 read with Section 1 .....

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the appellant and, therefore, credit is not admissible. After examining the evidences, the Commissioner (Appeals) held that evidence is not sufficient to prove that the goods have not been received. With respect to penalties imposed under Rule 15/15(2) of Cenvat Credit Rules, 2004 read with Section 11AC, the Commissioner (Appeals) observed as follows:- 8.3 From the above rule, it is very clear that only the manufacturer shall be liable to pay penalty in terms of provisions of Section 11AC of th .....

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of Section 11AC of the Act. Since the penalty is to be imposed in terms of Section 11AC, equal penalty of duty so determined should be imposed. In the instant case, the wrong aavailment of credit is ₹ 29,24,654/-, whereas all the five appellants have been imposed with penalty ranging from ₹ 10,00,000/- to ₹ 20,00,000/- which shows the lack of knowledge of the adjudicating authority on Central Excise provisions. Besides, it also shows that the impugned order has been passed mech .....

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ed that the onus of establishing that the goods were received in the factory is placed on the person who has taken the credit. He argued that it is not the responsibility of the Revenue to establish that the goods were not received. Learned AR also argued that the penalty has rightly been imposed under Rule 15/15(2) read with Section 11AC in view of the grounds of appeal. 3. Learned Counsel for the respondents argued that it is responsibility of the Revenue to establish that the goods have not b .....

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#39;ble Bombay High Court in the case of Asholk Kumar H Fuwadhya - 2010 (251) ELT 336 (Bom). 4. I have gone through the rival contentions. I find that Rule 9(5) of the Cenvat Credit Rules, 2004 reads as under: - 9(5). The manufacturer of final products or the provider of output service shall maintain proper records for the receipt, disposal, consumption and inventory of the input and capital goods in which the relevant information regarding the value, duty paid, CENVAT credit taken and utilized, .....

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statements have been retracted, however, there has been no effort on the part of respondents to fulfill the requirement of Rule 9(5) by proving the receipt of goods by them in terms of Rule 9(5) of the Cenvat Credit Rules. The Commissioner (Appeals) has wrongly placed the onus on the Revenue to establish that the goods have not been received. Impugned order to that extent is set aside and the matter is remanded to the original adjudicating authority to examine afresh giving an opportunity to th .....

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rder to appreciate the submissions canvassed by learned counsel appearing for the petitioners, it would be profitable to turn to Rule 13 of the Cenvat Rules applicable to the facts of the case in hand : Rule 13. Confiscation and penalty. - (1) If any person, takes CENVAT credit in respect of inputs or capital goods, wrongly or without taking reasonable steps to ensure that appropriate duty on the said inputs or capital goods has been paid as indicated m the document accompanying the inputs or ca .....

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